The past year has been challenging for fintechs — and the broader technology landscape, to be fair — but things especially difficult these days for digital advice companies.
I covered Betterment’s belt-tightening in February, and this week BlackRock decided to close its robo-advisor, FutureAdvisor, and sell the remaining retail accounts to Ritholtz Wealth Management.
Wealthfront also made a move this week to launch do-it-yourself stock trading accounts alongside its existing automated investing service. The company says this aligns with a long-held belief that individual stock trading can be one piece of an overall wealth strategy and that it believes it can offer a better approach than existing brokerage apps on the market. But it's still a notable shift for a company that has for years advocated the managed account approach. The move also comes after Wealthfront's planned sale to UBS collapsed.
Wealthfront is likely responding to the market trends that are pinching revenues across the broader tech market. Robo startups have long been supported by venture capital but are running out of runway before the need to turn a profit for backers. But when even a giant like BlackRock can't make the business work, you know things are getting tough.
Expect this to be a continuing story throughout the year.
Financial advisors using RBC Clearing & Custody will being able to use technology from digital record-keeping firm Vestwell to offer workplace retirement programs to clients.
The SECURE 2.0 Act has been a boon for Vestwell, which was growing quickly even before the bill made workplace retirement plans a more attractive area for financial advisors. In a statement, RBC Clearing & Custody president Brett Thorne said that the passing of SECURE 2.0 has made 401(k) solutions more of a priority for small business owners, and that products like Vestwell create a natural pathway for financial advisors to meet that demand. Vestwell recently partnered with Carson Group to power the firm’s new 401(k) offering.
Registered investment advisors using Riskalyze can now access exclusive private market investments through a partnership with fintech firm Opto Investments. As a featured partner on Riskalyze’s model marketplace, Opto will prove access to products spanning private credit, private equity, real estate, venture capital and infrastructure.
Individual investors hold roughly 50% of the world’s $300 trillion in assets under management, yet represent just 16% of the AUM held by alternative funds, according to a report from Bain. Companies like Opto are looking to grow individuals’ participation in the markets by building connections with RIAs and their technology. With the performance of traditional 60/40 portfolios still lagging, expect this rush into alternatives to continue.
Digital infrastructure company BetaNXT purchased Mediant Communications, which provides investor communications technology to banks, brokers, corporations, funds and investment managers. The move expands BetaNXT’s addressable market as well as adding proxy solutions and investor communications to its existing back-office technology suite.
Private equity firms Clearlake Capital Group and Motive Partners acquired BetaNXT from the London Stock Exchange in 2022 and are looking to expand its market presence in the U.S. Both companies have a stake in InvestCloud, and Motive is also connected with CAIS and FNZ.
Mat Mathews, who previously oversaw the managed secure file transfer service at Amazon Web Services as a general manager, has joined advisor fintech Advisor360 as the senior vice president of product. In the newly created role, Mathews will oversee the company’s product management and user experience teams.
Mathews is the latest example of the advisor fintech world hiring talent from the consumer tech world, as well as the latest connection between the wealth management world and Amazon Web Services. Several companies are moving their data onto AWS’s cloud-based infrastructure, including Orion Advisor Services, which announced its transition this week.
Two asset management firms, AssetCo and Westwood Group, are joining InvestCloud’s “Financial Supermarket” on a new model of investment product distribution. Executives of the firms say InvestCloud’s turnkey asset management platform will change how they distribute products and open up new markets of customers.
InvestCloud says the partnership will enable advisors to conduct simple searches to find new products that fit a client’s needs, digitizing a process for asset managers that remains manual and lacks data feedback.
The "Crypto Mom" departure would leave the SEC commission with just two members and no Democratic commissioners on the panel.
IFP Securities’ owner, Bill Hamm, has a long-term plan for the firm and its 279 financial advisors.
Meanwhile, a Osaic and Envestnet ink a new adaptive wealthtech partnership to better support the firm's 10,000-plus advisors, and RIA-focused VastAdvisor unveils native integrations with leading CRMs.
A former Alabama investment advisor and ex-Kestra rep has been permanently barred and penalized after clients he promised to protect got caught in a $2.6 million fraud.
As more active strategies get packaged into the ETF wrapper, advisors and investors have to look beyond expense ratios as the benchmark for value.
Wellington explores how multi strategy hedge funds may enhance diversification
As technical expertise becomes increasingly commoditized, advisors who can integrate strategy, relationships, and specialized expertise into a cohesive client experience will define the next era of wealth management
